Schlichter on Bitcoin

The brilliance released by this economic intelligence collision is almost intolerable.

April 26, 2013admin 15 Comments »
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  • Nick B. Steves Says:

    The extent to which bitcoin is increasingly seen as a hard leftoid phenomenon is… well… phenomenal. I guess if you go far enough to the left, you find reaction there too. I just can’t believe that these brain-dead leftists have any idea unequal the outcomes will be without government pressing on the scales. Power to the People! The Revolution Won’t Be Televised!! Yada Yada Yada!!!

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    admin Reply:

    If there are anti-Statists on the Left — meaning people who are seeking to experiment with non-parasitic forms of collectivism — then I see no reason to get into any kind of fight with them. Go for it. I’d even recommend handing them chunks of real estate and total political autonomy, so they can absorb the real consequences of their ideas without interference. I’m assuming the Left Bitcoiners — since they are obviously relaxed about cannibalizing the tax base — have to be of this ‘pirate party’ variety. What’s the problem?

    All that said, the phenomenon is still something of a mystery, since a pro-market left is not realistically sustainable (despite Rothbardian fantasies to the contrary), and Bitcoin might be the single most unambiguously market-oriented innovation in history. The great thing about markets though — unlike politics — is that they solve social (coordination) problems without any regard to the motives of participants. In the market-place, moral-ideological policing — which is always hard work (when not strictly impossible) — can be shunted aside, and the Thing still grows.

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    Mike Reply:

    I’ve noticed nothing of the sort, to be honest. Quite frankly, I don’t see how you come to your conclusion given your source – it just seems to be an apolitical account of businesses (presumably, they have a tech-savvy constituency) in Berlin accepting this new currency. Am I missing something?

    In fact, one of the things I’ve noticed about Bitcoin is actually how utterly uninterested the Occupy crowd has been in it. To date, Bitcoin has been purely a right-wing phenomenon, something supported by academic work that has been done on it (e.g. the study a few months ago that showed that the average Bitcoiner was a 32 year old libertarian male, or something like that, which is more or less what one would expect.)

    As our host says, Bitcoin is, quite possibly, the most market-oriented, market-facilitating invention in history. It’s not hard to see why the left would be uninterested at best in it.

    A Google search for “occupy bitcoin” (no quotes) shows some mild Occupy-demographic interest in it (as well as some really tragic bits of computer illiteracy, like http://abundanthope.net/pages/Political_Information_43/Globalist-Controlled-Bitcoin-Becomes-Bank-Supported-By-Technocrats_printer.shtml), but it hardly registers.

    Then you have this piece (http://www.obau.org/2013/04/08/bitcoins-are-so-hot-right-now/), where the author tries to borrow the anti-establishment cred of Bitcoin while, unsurprisingly, opposing the actual anti-leftist utility of it.

    And I think that will be one of the more entertaining functions of Bitcoin – making the left squirm. “Hey, you oppose money and banking and finance and all that sort of thing, how about this new central-bank-free, bailout-proof currency?” Of course, Bitcoin is an anti-cathedral appliance of computing and finance, so the left will be stuck. It’s a vehicle for exposing the cathedral, in other words.

    Choose your side, Bitcoin demands, and permits no equivocation, or at least no equivocation that doesn’t itself serve as a circumstantial marker of guilt.

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    admin Reply:

    I was weaving evasively around what you have straightforwardly stated, and have to say that your observation seems entirely credible. So:
    @ Nick B. — any chance you can you dish us up some more ‘hard leftoid’ Bitcoiners to dissect? The phenomenon is looking a little thin at this point.

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    Nick B. Steves Reply:

    @ Nick B. — any chance you can you dish us up some more ‘hard leftoid’ Bitcoiners to dissect? The phenomenon is looking a little thin at this point.

    A few extra data points:

    One-third of SF-based non-profit Internet Archive agree to accept some compensation in bitcoin.

    Bruce Wagner is as queer as a three-dollar bill.

    ASIC-based btc mining rig designer Guo avers bitcoin and Occupy are philosophically aligned.

    All I got time for for now…

    Mike Reply:

    That was a remarkably weak case. That the Internet Archive pays its staff in Bitcoins is neither here nor there politically. Guo’s maunderings (the article is at motherboard.vice.com) are little more than naive and unexplained connection of two unrelated phenomena (Guo doesn’t elaborate on why the two are connected), and Bruce Wagner is someone I’ve never heard of and you don’t explain who he is nor why you mention him.

    Overall, fail.

    (And quite frankly, I can’t imagine why the right would want to surrender the intellectual and philosophical ownership of Bitcoin to the left.)

    fotrkd Reply:

    I don’t know exactly where Max Keiser sits politically but he certainly appeals to leftists and has a serious interest in Bitcoin. If the left blames bankers for ‘the crisis’ and sees politicians as unable to react because they are in the bankers’ pocket, then the obvious solution is to destroy the banks. If Bitcoin can do that then they’re going to be interested in it. And unless you believe state taxation is the only means of delivering welfare or wealth redistribution, bitcoin is not inevitably the left’s enemy, or am I missing something? I’m sure there’s an appealing model for them anyway. Couldn’t, for example, bitcoin function quite successfully within left-wing endorsed co-operative structures?

    Nick B. Steves Reply:

    If you look at where bitcoin is being accepted in the physical world, it is almost entirely in hip, urban, artsy and cool enclaves. I think it self-evident that this is at least left libertarian territory. Silk Road is definitely left libertarian territory. Whether that constitutes “hard leftoid” is no doubt debatable. As we have alluded, if you go far enough left, you wind up advocating some of the same outcomes as neoreaction, even if by totally opposite principles.

    I don’t think simply noticing this “leftish” (if not “hard leftoid”, mea culpa) cache of bitcoin is tantamount to the “right” surrendering anything to “left”. Hard, cryptographic currency is what it is. In itself, it has no politics and seeks no power. It is an island of sane, simple, and elegant design. An uberhard currency will eventually, and perhaps quite suddenly, take away the power of the Powers That Be to manipulate outcomes on behalf of their most-favored constituencies. Since this is the animating power of western liberal democracies (even armies march on their stomachs), uberhard currency is an existential threat.

    It is open question which most favored constituency stands to lose most. “Women and minorities hit hardest” is the headline we may expect. But I think the seignorage inherent to fiat money means that Big Banks ultimately lose the most. So on that front the seething hatred that hip, arty Berliners feel toward Bankstas is perfectly aligned with their embrace of bitcoin. That hard rightists happen to approve is probably lost on them. What do hip, artsy Berliners know of Nazis… except that they’re eeevil? That women and minorities will be hit is probably lost on them, too.

    Mike Reply:

    OK, I can see your point, but it’s still true to say that Bitcoin’s genesis and first four-odd years were left-free. The youngish urban enclaves that are hip to the Bitcoin groove are so because of age, not because of politics. Remember the study that said that the average Bitcoiner was an agnostic 32yo libertarian male? Those are the Bitcoiners in places like Kreuzberg. I doubt the average leftist would have caught on to Bitcoin until his token libertarian friend clued him into it.

    And even then I doubt Bitcoin will catch on with the left. The left has never liked ultra-hard currencies, and Bitcoin is harder than gold.

    So any leftishness you’re detecting in Bitcoin is probably collinearity with age, rather than actual left-wing enthusiasm for Bitcoin. The leftist organs, whether cathedral proper (e.g. newspapers) or cathedral auxiliaries (e.g. Occupy) remain uninterested in Bitcoin.

    So while I can see the correlation between Bitcoin and youth, I think it’s a bridge too far to then go on to link it to leftists. Leftism and youth overlap, youth and Bitcoin overlap, but there’s not much three-way overlap between the three of them, at least as far as I can see.

    Leftists, their youth being no exception, are mostly suspicious of anything finance or banking-related. And that’s before you consider that, as you say, Bitcoin is hard to manipulate to benefit the left (that OBAU link I posted above is written by someone who dances around more or less that very point). That means that the left might very well hate Bitcoin when they find out what it is. So what then of Kreuzberg’s hipsters?

    So I think you’re jumping the gun to suggest that Bitcoin is of any leftist appeal. It has youth appeal, and youth are mostly leftist, but the Bitcoin-leftist nexus, if it exists, seems to be awfully well-hidden and publicity-shy.

    Nick B. Steves Reply:

    Well, libertarianism is (and only is) primordial liberalism. While it is of course not at all leftist (i.e., statist), it remains an acceptable point of view in polite circles. I’m certain that the typical agnostic 32yo libertarian male would have far more acceptable opinions than my own on any matter of “social import”.

    And we must remember that at any point in the time, the Cathedral is, in its own widely disseminated self-conception, nothing but gentle and moderate reasonableness, a veritable island of centrist sanity fighting against the “politics as usual” and “incendiary rhetoric” and “corrupt lobbyists” of both “sides” with its usual evenhandedness.

    So while you and I no doubt consider the Cathedral to be intolerably leftist (heck even the 1972 version of George McGovern would think that), when I argue for a “leftist cache”, the mainstream is not the “left” that I have in mind. There is something tugging the Cathedral inexorably leftward. That is the leftish-ness that I mean. The Whiggish Force tugs for ever more iconoclasm, ever more destabilization, ever more ironically ironistic irony. Yes, they are young. Only the young could be so stupid. But a chunk, only a chunk, of that culturally influential crowd (the 18-30 Ad Market!) is attaching itself to bitcoin… for however long it lasts.

    To this selected group of hipsters, it is a big middle finger to the bankstas, and in this they are not at all off base. They, of course, see the bankstas as rightism incarnate, like Hitler without the gay mustache. We know better, that the bankstas are bought and paid for subsidiarity of the (extreme leftist) establishment. A hipster wouldn’t know a true rightist if one bit him on the ass… If one did, he’d probably say, “Hey, another hipster. Cool.”

    However long it lasts depends on a lot of things, not the least is how long before USG plays whack-a-mole with bitcoin, and how big a hammer they bring. We are at a crucial juncture in the life of bitcoin. USD value of BTC transactions has gone up 20X this calendar year (4 mo. kid you not). If that momentum becomes a cascading flood of e-vendors who all start to benefit by the massive reduction in transaction costs (vis-a-vis CCs, paypal, and FX), e-vendors who not coincidentally will naturally market straight at that 18-30 Ad Demographic, it will become exponentially more difficult politically for USG to go play whack-a-mole: A lot more tsk tsking and finger shaking and half-measures around the edges, and a lot fewer 10-year prison terms and guys in black jackets and mirror shades.

    The bigger bitcoin gets, the harder it will be to kill. So I welcome all to the table, left, right, liberal, conservative, hip, and not, just to see if the experiment might be allowed to live.

    Federico Reply:

    Leftism is anti-dominant, subversive, egalitarian and universalist. These drives can conflict; that’s why progressives tend to downplay the extent to which government engineers moral transformation. I was interested to find that Scott Alexander considers interventions in exclusionary property rights, e.g. striking down of restrictive housing covenants, to be of negligible importance. It shall, in this light, be very worthwhile to chart the vast web of legal incentives, which pass themselves off as endogenous and spontaneous “change”.

    Secondly: no, these people do not understand the centrality of fiat currency to administered equality. Don’t forget that our perspective, however familiar to us by now, is recondite. We know that central banking is an excuse to levy a hefty, surreptitious tax; I guess hard leftoids, like most people, just think that national currencies are mismanaged, maybe even in the interests of Wall Street “bankstas”. Even Ron Paul fans don’t seem to grasp the Machiavellian enormity of the Keynesian Big Lie; I don’t think they realise that government is (at this point in history) more or less solely responsible for financial crises.

    Thirdly, power and status are a huge motivating factor in political movements. Bitcoin, unlike any other obvious, feasible current of political activity today, offers an immediate and easy chance for non-elites to position or imagine themselves as a new power base. If Bitcoin were to become the world’s new currency—which it won’t—it’s a good idea to get on the bandwagon early. See also: the blogospheric explosion a few years ago, when lots of smart, unheard voices brought their A-game to the internet, in anticipation of sudden and real power (which didn’t quite emerge). Hard leftoids, rightoids, libertoids and reactoids are almost all eager to trade integrity for power.

    [Reply]

    admin Reply:

    A stream of great points. The last, in particular, should give us pause: its explanatory value is impossible to over-estimate.

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    Nick B. Steves Reply:


    I just can’t believe that these brain-dead leftists have any idea unequal the outcomes will be without government pressing on the scales.

    I take that back.

    Government is pressing on the scales to buy votes, manufacture consent, appear to be in control, stay in power–stuff that I always associate with the left, but in practice this is neo-liberalism. The end of the chain losers in the Fiat Era are ultimately going to be the people who don’t know there aren’t enough chairs (by a factor of 10) to sit in when the music stops, who don’t even realize the music is playing at all, people who think “I have X money in the bank” is a statement of fact and not a figure of speech. And this is the left (what?) 60% of the bell curve. That’s a lot of people to care about if you care about people. And hard leftoids care about people… perhaps to a fault… but a helluva lot more than neo-liberals. Ya know, I care about people too… at least more than neo-liberals.

    And I’ll join the “punk brewers” who giggle at making banks go bankrupt. In fact, I’d double down and suggest a public hanging of a randomly selected TBTF banker, once per week, as long as it takes, until banker morale improves.

    More power to the hip, artsy Berliners. I absolutely agree with Nick Land, let them have their space. They are no enemies of mine, so long as I don’t have to send my children to their schools or look at their “art”.

    [Reply]

    admin Reply:

    “They are no enemies of mine, so long as I don’t have to send my children to their schools …” — if the historical pattern holds good they’ll be eating their children within six months, so that shouldn’t be a problem.

    [Reply]

    Posted on April 28th, 2013 at 12:42 am Reply | Quote
  • Mike Says:

    Oh, and the Schlicter article was superb, thanks for the link. (Forgot to mention that – I got a bit carried away…)

    [Reply]

    Posted on April 28th, 2013 at 12:27 pm Reply | Quote

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